- Among EV stocks in North America, GreenPower Motor Company is the only one besides Tesla that has been delivering units on a consistent basis
- For the fiscal year ending March 2020, GreenPower delivered 122% sales growth with a 30% gross profit
- One recently announced sale alone is 1.5X all of FY 2020 sales in numbers of vehicle sold
- Raised $37M from an August IPO with concurrent uplisting to NASDAQ, allowing production ramp to meet demand
- Expects to deliver the first fully autonomous electric transit bus in the U.S. by eoy
- Current market cap of just $235M dwarfed by other, untested EV stocks that have had zero deliveries to date
GreenPower Motor Company (NASDAQ: GP) manufactures a range of all-electric commercial vehicles for public transit, schools, charter buses, delivery, vanpooling, and shuttles. Their assembly plant is in Porterville, CA and corporate headquarters in Vancouver, Canada.
September 2020 Investor Presentation
Commercial EV market opportunity
Investors have been clamoring to find the next Tesla before it’s discovered, pushing valuations of some reverse merger SPACs (special purpose acquisition company) to valuations well into the billions even before the mergers have completed. And there’s a reason why: The EV market is projected to show booming growth over the next decade. Deloitte projects a 29% CAGR (compound annual growth rate) for the overall EV market from 2020-2030. In fact, by 2030 EV sales are expected to exceed internal combustion engine vehicle sales, taking 51 percent of the market.
Beyond cars, much of the EV growth will be driven by buses, and fleet sales of light and medium duty commercial trucks. In fact, MarketsandMarkets projects a whopping 32.7% CAGR in electric commercial vehicles between 2020-2027. Do a search of “commercial vehicle EV market growth” and you’ll find plenty of research that suggests this is a faster growth segment of the market than consumer/passenger cars are.
Investing in EV stocks can be a crapshoot right now. The market is young, and the winners haven’t been separated from the losers. But investors can gain a significant edge in EV stocks like GreenPower that have early mover advantages in a high growth segment of the market.
While commercial sales of buses, light and medium duty trucks and delivery vans are projected to have a near 33% CAGR between now and 2027, GreenPower Motor is already delivering sales while growing all-important sales and market relationships as an early mover.
The fact is, there are only two pure play EV stocks in North America that have consistently delivered actual sales to date, (not future reservations or promises), and they are Tesla Motors and GreenPower Motor Company.
GreenPower product line. Click images for details & videos.
Click for video of all vehicles
122% increase in sales for FY 2020
For the company’s fiscal year 2020 which ended in March, GreenPower reported $13.5M in sales, a 122% increase over 2019.
This top line number is modest compared to sales at Tesla of course, but Tesla has a market cap of $362 billion vs. GreenPower’s $235 million. More importantly, GreenPower has consistently maintained gross profit as a percent of sales between 30-35% over the last three years. The ability to grow sales at 122% while carefully managing expenses is very encouraging. In fact, GreenPower Motor predicts turning cash flow positive with only a modest increase in sales.
Huge increase in new orders already booked for 2021
For the fiscal year 2020, GreenPower sold a total of 68 vehicles, while for FY 2021 they’ve already received orders for 313 vehicles…and they’re only half-way thru the year! These include three orders from California’s Green Commuter, (North America’s largest zero emissions vanpool), totaling 203 EV Stars, 10 all-electric B.E.A.S.T. school buses, and an order for 100 vehicles from ABC Bus Inc. in New York.
Investors can expect more sales to be announced soon. GreenPower recently went on a tour with Creative Bus Sales, the nations largest School bus dealer who now list the GreenPower BEAST prominently on their site.
Why the surge in new orders?
There are several very definitive reasons, which include some big competitive advantages that GreenPower has that I’ll be discussing in a follow-up article in the near future. Subscribe now for the follow up!
Proterra valued at $1B despite only 950 vehicle sales in their history
The largest electric bus manufacturer in the U.S. is privately held Proterra, which was valued at just over $1B in an August 2019 round of funding.
According to their web site, Proterra delivered just 950 vehicles throughout their entire history. Compare that to GreenPower, which racked up 313 vehicle sales during the last few months alone and it’s obvious GreenPower Motor is rapidly gaining market penetration. Because Proterra is private, (although I suspect they may reverse merge with a SPAC or IPO themselves soon), we don’t know the mix of their sales, profit margins, or any fundamentals to make an accurate valuation comparison. But on a pure unit sales and recent sales growth trajectory, GreenPower is definitely “charged up” and on the right track.
GreenPower is first mover in fully autonomous transit buses
A vast majority of investors in EV stocks don’t know this game-changing fact about GreenPower: The company has first mover advantages in launching a fully autonomous transit bus, which should happen within the next 2 months.
Working with Perrone Robotics, and the Jacksonville Transit Authority, GreenPower is “laying the foundation for what will be “the nation’s first public transportation network powered by autonomous vehicles”, according to JTA Chief Executive Officer Nathaniel P. Ford.
See also: Perrone Robotics Fully Autonomous EV Star page.
GreenPower Motor President, Brendan Riley stated:
“This delivery will mark the first fully autonomous transit bus in the United States entering test operations and we are thrilled to partner with Perrone Robotics to serve this industry-leading AV program with the Jacksonville Transportation Authority. The speed with which the fully autonomous transit market is evolving is remarkable and is being accelerated by the current environment. Not only are we seeing the autonomous movement take hold, we are witnessing the transit footprint become smaller and more nimble which bodes well for our market position with the EV Star.
The growth curve in autonomous trucks like the EV Star is especially high in North America, which also leads the world in the development of autonomous technology….
..and GreenPower Motor is positioning themselves ahead of that curve.
Summary
Discerning investors in EV and cleantech stocks will discover GreenPower Motor Company in the coming weeks and months. It’s hard to ignore the company’s cash position from the recent $37M IPO, market opportunity in the commercial trucking/transit sector of the electric vehicle market with a 33% CAGR, rapid near term sales growth as announced over the last several months, and all the 1st mover advantages that come with launching “the first fully autonomous transit bus in the United States”.
Follow up article on GreenPower Motor
I’ll be writing a follow up article on GreenPower focusing on the Company’s competitive advantages, why the stock has traded down from a high of $23/share from the August 28th IPO/uplisting, and more. So subscribe now and get the follow-up article.
Disclosure
I am long shares of GreenPower Motor Company (GP) and have a 6-12 month price target of $25. I have not been paid by GreenPower Motor Company or any third party for this article.
Best wishes for profitable investing!
Gary Anderson
Publisher
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Read the follow up article: GreenPower’s Competitive Advantages
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